Not since Franklin Roosevelt has an American president shaped American life so decisively as Ronald Reagan. His supporters believed the president spurred a "Reagan Revolution", a conservative transformation of the nations political economy. His actions to restore economic won him reelection in 1984.
The Reagan Style: Ronald Reagans style was optimistic and he had something of the common touch about him even though he lived a life of luxury. His optimism went beyond style, it was conveyed in his speech and actions. Reagan appeared to love being president and his opinions ratings were generally high. The hostages in Iran were released the morning of his inauguration. Reagans optimism prevented pessimism, even when an assassins bullet nearly killed him.
Shrinking Government: But Reagan was more than just style. He represented a clear conservative alternative to the liberal policies of the New Deal and the Great Society. He endorsed the "New Federalism:, a program designed to return power and tax revenue to state governments claiming it would promote efficiency and economic growth. Although President Reagan attempted to reduce government spending by asking for a line item veto among other things, the Congress did not approve the changes. The president wanted to reduce food stamps, school lunch programs, and aid to cities funding and Congress did cut appropriations for urban public housing and eliminated job training for the unemployed. Social Security and Medicare were left untouched. Although his administration could not tear down welfare or other benefits, Reagan did manage to slow the growth of welfare and shrink budgets of some government programs he did not like.
Reaganomics: Reagans overall economic philosophy held that the nation prospered most when the government left Americans free to manage their personal economies. Known as "Reaganomics", the theory was based on a relatively new theory known as "supply side economics". Basically it holds that in order for government to promote prosperity it should cut taxes and leave more money in the hands of businesses and allow them to invest in more production of goods and services. With an increase in supply would stimulate prosperity and lead to more tax revenue for the government. Supply side economics was controversial because to liberals it was just another plan to allow the rich to keep their money. The Economic Recovery Act significantly weakened the governments long-standing support for the policies of Keynesian economics and progressive taxation. The other change Reagan wanted to see was government regulation. Reagan believed that federal rules and requirements stifled business. Environmental regulations were lifted. The telephone industry was deregulated. He also wanted to weaken labor unions. His actions against air traffic controllers resulted in the firing of striking workers and replacing them with non-union workers. These Reaganomics applications changed the federal governments role in the economy. They also increased the deficit. But, by the spring of 1984, the recession was over. Reagan got the credit for the recovery.
The 1984 Presidential Election: With the return of prosperity, Reagan was re-elected to a second term against the Democratic challenger former vice president Walter Mondale and his running mate Geraldine Ferraro, the first female vice presidential nominee. Reagans Republican victory did not translate to a Republican victory in the House of Representatives. Congress was still divided.
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